The 15th Finance Commission was formed in November 2017 to define financial relations between central and state governments in India and recommend a formula for sharing tax revenue for five years. It examined fiscal issues and problems and made recommendations. The commission decreased the share of taxes devolved to states from 42% to 41% for 2020-21, with 1% allocated to newly formed Union Territories. The commission's revenue sharing formula updated criteria from the 14th Finance Commission, such as increasing the population weight from 10% to 15% and adding new criteria for forest ecology, demographic performance, and tax efficiency.

1. PROF .RAMKRISHNA MORE ARTS ,COMMERCE & SCIENCE COLLEGE
Presented by- Jitendrakumar N. Suthar

2. INDEX
S.N. Content
1 Introduction of Finance Commission.
2 History of Finance Commission
3 Role of Finance Commission
4 Overview of 15th Finance Commission.
5 Devolution of Taxes and Non-Taxes Revenue To States
6 Formula For Sharing Revenue

3. 1.INTRODUCTION OF FINANCE COMMISSION
• The finance Commission was established by the
President of India in 1951 under Article 280 of
Indian Constitution.
• It was formed to define the financial relations
between the Central and State Governments.
• The primary Role of Finance Commission is to
Recommend a formula for sharing Tax revenue
Between Central and State Governments.
• Finance Commission form in every 5 year or Earlier
on the Recommendation of President.

4. 2. .HISTORY :FINANCE COMMISSION
On 22 November 1951 , Kshitish Chandra Neogy was
appointed as First Chairman of Finance Commission.

5. 3A.ROLE OF FINANCE COMMISSION
1. Distribution of Tax Revenue-
• The distribution of the Proceeds of taxes
between the Union, State ,Municipalities.
• Allocation of share of taxes between the
Municipalities at levels in a state.
2. Distribution of Non-Tax Revenue-
• Distribution of Non-tax revenue such as
duties,toll,fee and Penalties levied by State and
Union.
• Determination of Non-Tax revenue to be
assigned by the Municipalities.

6. Grants
Grants-in-Aid Special Grants
Grants for
Disaster Risk
Management
Revenue Deficit
Grants
3B.ROLE OF FINANCE COMMISSION
3. Allocations of Grants:
Finance Commission Recommends
fund and grants to be transfer to Local Bodies . The union
also Provides fund to State Disaster Relive Funds. Finance
Commission Provides Compensation of losses occur by
States.

7. 4. Other Transfer To States:
• Assistance and Resources for North east Region.
• Aid and Loans For Infrastructure Project.
• Special Assistance under the Demand such as
assistance to schedule Cast and tribal area.
3C.ROLE OF FINANCE COMMISSION

8. 3D .ROLE OF FINANCE COMMISSION
5. Examine Fiscal Issue and Problems and Give
Recommendations to Solve Fiscal Issue.
• Recommendations Regarding Fiscal Deficit and
Debt Levels.
• Recommendations about off Budget Borrowings.
• Statutory framework for Public Financial
Management.
• Recommendation Regarding Tax Capacity of
GDP.
• Suggestion about GST for Better Implementation.

9. 4A. OVERVIEW OF 15TH FINANCE COMMISSION
President Ramnath Kovind and Nand kishor Singh
Chairman of 15th Finance Commission.

10. 4B. OVERVIEW OF 15TH FINANCE COMMISSION
15th Finance Commission
Formed in November 2017 to give recommendations for
devolution of taxes and other transfer for five Year. In July 2019
the term was extended by one month to November 2019.
* Shaktikanta Das served till December 2018.
*Ajay Narayan Jha Served as Full time Member.

11. 5. DEVOLUTION OF TAXES TO STATES
• The Share of Taxes decreased from 42% to 41% for 2020-21
•1% decrees is to provide for Newly formed UT Jammu and
Kashmir and Ladakh.

12. 6. FORMULA FOR SHARING REVENUE

13. 6B. FORMULA FOR SHARING REVENUE
Criteria 14TH FC 15TH FC
Income Distance 50 % 45%
Population (1971) 17.5% ---
Population(2011) 10% 15%
Area 15% 15%
Forest Cover 7.5% ---
Forest & Ecology --- 10%
Demographic Performance --- 12.5%
Tax Efficiency --- 2.5%
Total 100% 100%

14. THANK YOU
References:
1. Public Econmics ll- Success Publication.
2. Wikipedia.org
3. Economicstimes.indiatimes.com
4. Fincomindia.nic.in: Finance Commission
5. Prsindia.org: PRS India Research
6. Financialexpress.com